The Centers for Medicare and Medicaid Services announced Thursday at HIMSS14 the availability of hardship exemptions for compliance with Stage 2 electronic health records meaningful use requirements during 2014. Further, Stage 3 ambitions may be scaled back somewhat, as officials acknowledge the regulatory burdens that providers have with meaningful use, ICD-10 and health care reform.

The exemptions would forestall providers paying a penalty through reduced Medicare reimbursements--starting in 2015--for failure to meet meaningful use requirements.

CMS Administrator Marilyn Tavenner said she understands there have been concerns about providers being able to meet deadlines for collecting data during a 90-day reporting period in 2014, and then attesting for meaningful use. “We have tried to make changes in the schedule, pushing back Stage 2 as far as we could,” she said, referring to a previously announced third year for Stage 2 and a delay in Stage 3. “Now is not the time for us to stop moving forward.”

But CMS understands that the calendar for meeting meaningful use in 2014 poses significant challenges because many vendors don’t yet have necessary products certified to meet Stage 2 requirements, or providers are waiting in long lines to get updates to their software and running out of time to implement the updates and collect/report data. Further, the ICD-10 deadline looms large.

Under the new policy to bring some regulatory relief to Stage 2, providers may request a hardship exemption and avoid the Medicare payment penalty in 2015 if they cannot demonstrate meaningful use for 2014 due to:

* The lack of availability of 2014 certified EHR technology,

* The inability to upgrade their current EHR product in time to meet meaningful use, or

* An inability to incorporate Stage 2 requirements into their workflow in time to meet meaningful use.

In announcing the decision, Tavenner said CMS understands providers and vendors may have legitimate issues and they will work with them. However, she stressed all eligible providers are expected to eventually meet the requirements.

Federal officials during a media roundtable said they will release more information on the hardship exemption policy but could not give a date on when it will be available.

Another CMS official, talking with Health Data Management at HIMSS, said rollout problems with Stage 2 have made federal policymakers more sensitive to ensuring Stage 3 criteria won’t be an overreach.

“We are definitely hearing the outcry of providers being overburdened,” said Elizabeth Holland, director of the health IT initiatives group in CMS’ Office of E-Health.  She noted that the Stage 2 burdens are coupled with ICD-10 and health reform initiatives that also require significant provider attention.

The task for CMS in Stage 3, Holland added, will be to make it meaningful while being aware of other regulatory burdens. “We don’t want people falling off the escalator. The balance is on how much to press and push.”

Robert Tennant, senior policy advisor at the Medical Group Management Association, praised CMS’ decision to offer the hardship exemption while noting the devil will be in details not yet available.  Tennant said the exemption “is a very, very good faith effort” by CMS to not penalize providers who are trying to comply with meaningful use encounter issues out of their control.

The exemption policy is a recognition that vendors have not come along with Stage 2 as quickly as envisioned, Tennant says, while keeping discouraged physicians on track to continue with the program.

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